HC Deb 26 February 1997 vol 291 cc333-5
13. Sir Michael Neubert

To ask the Secretary of State for Education and Employment when she next expects to meet her European Union counterparts to discuss the prospects for employment in Europe. [16065]

Mr. Paice

At the informal meeting of the European Union Social Affairs Council in March, my right hon. Friend the Minister of State will again emphasise that prospects for employment in Europe will be best served by the development of efficient, flexible and competitive labour markets.

Sir Michael Neubert

Is it not instructive to compare the unemployment level here—1.8 million and falling—with that in Germany, which is 4.5 million and rising? Does my hon. Friend agree that if unemployment here increased by 500,000 in a single month—as Germany's did in January—the Opposition would be in uproar, Opposition Members on the Front Bench below the Gangway would be on their feet and the sitting would have to be suspended? Is it not extraordinary that the same Labour party supports the social chapter, the national minimum wage and all the burdens on business that have needlessly brought the misery of unemployment to many more millions in Europe—approaching 20 million at the last count?

Mr. Paice

I suspect that my hon. Friend's estimation of what might have happened if we had had those figures in this country is entirely right. I am constantly amazed that after 18 years in opposition the Labour party has not yet taken on board the fact that, however well meaning a measure may be to protect jobs or to improve people's working conditions, its effects are counter-productive. As the Labour party found in the 1970s with its Rent Acts, when we increase protection, we destroy opportunity. That is the lesson that we have learnt and which is now, sadly, being learnt throughout the rest of Europe. We are not prepared to go back to that.

Mr. Mackinlay

The Minister will be aware that the Secretary of State's attention has been drawn to a table in the Red Book which shows that the Government project that there will be a substantial increase in cyclical social security expenditure between now and 2001. Bearing it in mind that the table shows that the Government project a substantial increase in expenditure on unemployment between now and 2001, will the Minister explain why the Government have proclaimed that they are not in the business of increasing unemployment?

Mr. Skinner

That man can think on his feet.

Mr. Paice

The hon. Member for Bolsover (Mr. Skinner) says that the hon. Member for Thurrock (Mr. Mackinlay) can think on his feet, but the hon. Gentleman will have to think again because the conclusions that he has drawn from the Red Book are totally wrong. The Government intend to continue with the policies that have seen unemployment fall dramatically since 1992 and we anticipate unemployment continuing the downward trend that it has followed for so long.

Mr. Duncan Smith

Does my hon. Friend agree that the real problem is that the Opposition think that Governments can create jobs? Is it not also the point that in Europe they still have the vestige of the leftovers of the idea that Governments can somehow create jobs? Producing the Labour policy document this afternoon has more to say about Labour Members wanting permanent employment on the Government Front Bench and has nothing to do with creating permanent jobs outside.

Mr. Paice

My hon. Friend is absolutely right. It is a message that we cannot emphasise too much. Jobs are created by successful businesses which produce goods or services that other people want to buy at a price that they can afford. Governments can create the conditions for business to prosper like that, but no Government can create the jobs that the Labour party seems to believe that they can. The Government will go on creating the conditions for business to create jobs.

Mr. Bryan Davies

Has the Minister read today's report from the Employment Policy Institute? Does he appreciate that it states that there is no evidence that the social chapter would cost jobs, and that Tory claims are overblown, inaccurate and unresearched? Is not the real issue that withdrawal from Europe, the agenda of so many Conservative Back Benchers and quite a few members of the Cabinet, would cost 3.5 million jobs?

Mr. Paice

My right hon. Friend the Prime Minister has made it absolutely clear that withdrawal from Europe is not part of the Government's approach to Europe, but on the social chapter, the people whom I prefer to listen to are the businesses that have to live with the burdens of the policies that this country could be faced with if we committed ourselves to the social chapter. I would far rather listen to German businesses that are disinvesting in Germany and coming to this country or elsewhere to escape those burdens, and to British businesses—as indeed I and other colleagues did yesterday—that are located throughout Europe and that say that they cannot expand because of the burdens of the policies caused by a social chapter approach to life. I would much rather listen to those people than to some spurious report that is clearly at odds with all the experience of businesses throughout Europe.

Mr. Mans

Will my hon. Friend give some reassurance to constituents in my part of Lancashire, and particularly to students and to people who work in the tourism industry, that the Government have no intention whatever of introducing a minimum wage, as such a device would cause havoc in the tourism industry, increase local unemployment, decrease wealth creation in the tourism industry and prevent students at local universities from taking jobs to help the economy and to help themselves through university?

Mr. Paice

I can assure my hon. Friend that the Government have no intention whatever of introducing a minimum wage, for precisely the reasons that he describes, but also because of the implications that it would have for wage escalation. If a minimum wage at anything like the level described by the Labour party or its paymasters were introduced, everybody would seek to maintain differentials, at least to some degree. That is where huge wage and price inflation would come from, and so would unemployment: at least a million jobs would be lost.